Ok someone explain this to me...Market is up while Treasuries are down on news of Euro bailout

After reading this article, something jumped out that just doesnt seem to make sense.

I know there are quite a few people here who have more intimate knowledge of the markets, so I figured I would throw out a question.

Understandably, without help, Europe could conceivably collapse, which would devastate the global economy. That being said, with the exception of confidence, what would cause the stock market to gain over 200 today, while the news stated that treasuries took a hit, and we are about to spend even more money we dont have bailing out the EU?

Is confidence that the bailout will help the only thing holding the pieces of this crappy puzzle together?

reply to post by BigTimeCheater


Risk on trade.

Markets do not like not knowing information. Once information is known usually the markets will go higher, no matter if good or bad.

This all plays a part in "Buying the rumor and selling the news". If you ask me, and you didn't, it was all priced in anyway. It was just a buying opportunity at a support line that has been tested 3 consecutive days.

My guess is that a lot of these are shorts term trades by insiders trying to get other traders to buy buy buy, this way right before SHTF they can sell and make a huge profit!

Originally posted by thewholepicture
My guess is that a lot of these are shorts term trades by insiders trying to get other traders to buy buy buy, this way right before SHTF they can sell and make a huge profit!

It works perfectly.

The jobs numbers are mostly seasonal so the media cheerleaders will obviously stir up buying. Ireland and the Euro going splat should be the big news maker and really should be what investors are looking at.

"Its a new month, and it appears that cash getting put to work. Futures screaming higher, up more than a full 1%, with the Dow at plus 118, Nasdaq showing +20.

Some of the upwards movement is on expectations that the ECB will further settle the bank crisis there; some is simply new month, and for some funds, new fiscal year, putting money to work."

Barry Ritholtz - The Big Picture

Treasuries Advance as Newspaper Reports North Korea May Be Planning Attack

So says Bloomberg. That coupled with Bill Gross' negative comments on economic growth may help explain the flight to safety, but how do we explain the counter-intuitive "risk-on" trade in equities ?

$8.2 Billion POMO Closes

Submitted by Tyler Durden on 12/01/2010

The Fed-Primary Dealer scam continues in plain view. After today's $8.2 billion POMO closed at a 3.7x Submitted to Accepted ratio (below median ratio - surge in stocks right on schedule)....

More

8.2 Billion lining the pockets of the Fed agent bankers can spark one helluva broad market short covering rally.

reply to post by BigTimeCheater


Market is priced in $$, $$ falls in value, market falls in value but less than $$, $$ price on the market appears to go up.

it's the carry trade day......i went long yesterday....this happens every week...and has for three decades...it makes a low the day prior!!

reply to post by BigTimeCheater

That being said, with the exception of confidence, what would cause the stock market to gain over 200 today, while the news stated that treasuries took a hit, and we are about to spend even more money we dont have bailing out the EU?

I wouldn't fall for the " up" fake for a minute. This market is not for the faint of heart, or those who can't afford losing your funds. There are too many factors out there, indicating to me that volatility will again rear it's ugly head.It's a crap shoot not worth taking, in my humble opinion.